On the eve of the trial for the dispute between Google’s driverless car unit (Waymo) and Uber, the federal government turned over a 37-page letter from a former lawyer at Uber to Uber management. The federal government found the letter as part of a criminal investigation it is conducting of Uber. The letter detailed a team Uber had created to steal trade secrets. The letter also explained how the team had dedicated experts to help them avoid detection by regulators. There are descriptions of e-mail destruction and devices that stored information outside Uber servers so that their activities would not surface in litigation discovery processes. The goal, according to the letter,”was to prevent Uber’s unlawful schemes from seeing the light of day.” Greg Bensinger, “Uber Formed Covert Unit to Steal Trade Secrets,” Wall Street Journal, November 29, 2017, p. A1.
The letter was written by Ric Jacobs, a former member of Uber’s security team, and was sent to Uber management earlier this year. However, the letter was never turned over during the discovery process. Mr. Jacobs left Uber in April 2017, and the company reached a $4.5 million settlement with him later.
Federal District Court Judge William Alsup said that he had to postpone the trial because even if one-half of what was written in the letter was true, that it would be an injustice to require Waymo to proceed without further time to process the contents of the letter. When Judge Alsup read the letter in the court room, everyone was silent, taken aback by the allegations.
Uber explained that the letter was written for purposes of obtaining a settlement. Mr. Jacobs did testify on the stand and distanced himself from some parts of the letter, explaining that his lawyer wrote the letter.
Discovery requests in civil litigation are broad and often require parties to turn over all e-mails, correspondence, etc. to and from certain persons or divisions within a company. The failure to turn over all documents or destructions of documents and evidence can result in extra time for the other side, as in this case, or contempt charges, or the exclusion of the use of evidence at trial (if it is favorable to the side being sanctioned).
These events are a lesson for companies in terms of turning over evidence and a lesson in how difficult it can be to hide activities when so many people are aware of them or involved in the work.
Explain what Uber is alleged to have done
Explain the penalties for withholding evidence.